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AICPA CPA-Business Exam - Topic 2 Question 50 Discussion

A firm has daily cash receipts of $100,000. A bank has offered to reduce the collection time on the firm's deposits by two days for a monthly fee of $500. If money market rates are expected to average 6 percent during the year, the net annual benefit (loss) from having this service is:
C) $6,000
A) $3,000
B) $12,000
D) $(6,000)

AICPA CPA-Business Exam - Topic 2 Question 50 Discussion

Actual exam question for AICPA's CPA-Business exam
Question #: 50
Topic #: 2
[All CPA-Business Questions]

A firm has daily cash receipts of $100,000. A bank has offered to reduce the collection time on the firm's deposits by two days for a monthly fee of $500. If money market rates are expected to average 6 percent during the year, the net annual benefit (loss) from having this service is:

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Suggested Answer: C

Choice 'c' is correct. $6,000 net annual benefit from using a lockbox system.


by Raina at May 07, 2022, 05:07 PM

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Precious
8 months ago
Totally agree, $6,000 sounds right!
upvoted 0 times
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Fannie
9 months ago
Wait, how does that even add up?
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Meaghan
9 months ago
I think the net benefit is $6,000.
upvoted 0 times
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Kristeen
9 months ago
That fee seems low for a 2-day reduction!
upvoted 0 times
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Joanne
9 months ago
Daily cash receipts are $100,000.
upvoted 0 times
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Franchesca
9 months ago
Ah, I think I know what's going on. The post_max_size setting is probably too low, which would prevent the file from being uploaded. I'll make sure to check that.
upvoted 0 times
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Novella
9 months ago
Okay, I think I've got this. Mentoring is all about personal and professional development, so I'm going to go with option A. It strengthens an individual's self-development, which seems like the most direct benefit.
upvoted 0 times
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Otis
9 months ago
Hmm, I'm a bit unsure about this one. The options seem to cover different aspects of a job worth hierarchy, but I'm not totally clear on how they all fit together. I'll have to think this through carefully.
upvoted 0 times
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Launa
10 months ago
This is a tricky one. I'm tempted to go with a slightly more conservative option like A, but I don't want to overcommit either. I'll need to carefully weigh the trade-offs before making a decision.
upvoted 0 times
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